Lekoil and GE oil and gas unit sign deal for development of Ogo field, offshore Nigeria

Created: Wednesday, 05 April 2017 07:11

PSO Mystras offshore Nigeria. (Image source: Ciacho5/Commons)Lekoil and General Electric's oil and gas unit have inked a deal to collaborate in the development of the Ogo field, offshore Nigeria

The plan between Lekoil and General Electric's oil and gas unit includes plans for new appraisal results. Lekoil has said that the arrangement will also leverage GE's equipment and technical expertise. The deal will see the energy conglomerate receiving a percentage of future cash flow from the Ogo field. It will also see them having the ability to supply products and services for the life of the project.

Lekoil expects the full development of the field to cost around US$400mn, with a subsequent upstream gas field development expected to cost a further US$600mn.

Lekan Akinyanmi, LekOil chief executive, said: “We are pleased to announce this MOU with GE Oil & Gas which marks the first step in our aim to fully develop the Ogo field.

The expected terms of the deal will see Lekoil's 40 per cent stake in the Ogo field to be unaffected by the deal with GE.

"The agreement brings a world-class resource to OPL310 and significantly reduces LEKOIL's cost of capital to bring the field into production.

"As we have previously announced, we are still in the process of securing ministerial consent for the remainder of the OPL310 acquisition and we remain confident that we will receive all the necessary approvals prior to the start of the appraisal programme."